1981 Supreme(MP) 538

S. K. Seth, J.
Shivnarayan v. Manakchand.
C. R. No. 917 of 1979 of Decided on 22-9-1981.

Headnote:Stamp Act, 1899 -- S. 32 (c) Proviso -- promissory note not executed on duly stamped paper -- Collector has no jurisdiction to validate the same on charging deficit duty or penalty -- such promissory note is inadmissible in evidence even if validated by Collector.

        The defendant-applicant in his written statement, denied the claim of the plaintiff nond`respondent. He also raised a legal objection to the effect that the promissory note relied on by the plaintiff non applicant was inadmissible in evidence inspite of it having been validated by the Collector of stamps. It was pointed out that under the provisions of the Stamp Act, the Collector had no jurisdiction to validate an insufficiently stamped promissory note.

        The abovesaid legal objection by the defendant-applicant was tried and disposed of by the trial Court as a preliminary issue. It was held by it, vide the impugned order, that the Collectors certificate was conclusive against stamp objections and was binding on the Court under section 32 (3) and proviso (e) to section 35 of the Indian Stamp Act and that a promissory note even if wrongly certified by the Collector became admissible by virtue of the Collectors certificate. While reaching the abovesaid conclusion, reliance was placed by the trial Court in a Single Bench decision of this Court in Dagadu v. Dbannalal, (ILR 1962 MP 642).

       

        Held: It is no doubt true that under section 32 of the Stamp Act, the Collector has been given certain powers to make endorsements on instruments to the effect that the instruments are not either chargeable to duty or that full duty with which they are chargeable has been paid However, as would be clear from clause (C) of the proviso to section 32. the powere of the Collector under the sad section do not apply in respect of instruments chargeable with a duty not exceeding 10 N. p. or any bill of exchange or promissory note, when brought to him after the drawing or execution thereof, on paper not duly stamped. Thus, if a promissory not is executed on paper which is nor duly stamped, the Collector cannot enter any certificate on such an instrument and such an instrument cannot be validated by the Collector by collecting the deficit day or penalty.

        The abovesaid view finds s Support from a Single Bench decision of this Court in Babulal v. Ramratan Sahu (1971 MPU SN 101) which follows a Full Bench decision of Allababad High Court in Govind. and v. Radha Mohan (AIR 1971 All 280), A Division Bench of this Court, sitting at Gwalior. bas reeetly, on a reference made by a Single Bench in Dr, Phool Singh Tomar v. Suresh Chandra (Civil Revision No. 31 of 1976), approved the view expressed in Babulals case (supra) vide its order dated - 54-1981 and held the view taken in Dagadus case (supra) to be not good law.

        For the reasons stated above, the revision is allowed. The order dated 29 8-1979 passed by the trial Court rejecting the objection taken by the defendant-applicant, is set aside. It is held that the promissory note relied on by the plaintiff Don-applicant is inadmissible in evidence in spite of it having been validated by the Collector of stamps for the reason that under the provisions of the Stamp Act the Collector has no jurisdiction to validate to instrument insufficiently stamped promissory not. The preliminary issue shall stand disposed of accordingly. ILR 1962 MP 642 = 1962 JLJ 1097 held no mere good law. 1971 MPLJ SN 101, AIR 1971 All. 280 and C. R. 31 of 1976 (G) decided on 25 4-1981 relied on. Revision allowed.